MOSCOW (MRC) -- US-based producer Chemours reported on Monday a year-on-year decline in Q1 net income but still raised its outlook for 2021, said the company.
First-quarter income fell because costs rose faster than revenue. Also, Chemours reported a tax charge of USD5m versus a benefit of USD23m from the same time in Q1 2021. The following shows the company's Q1 financial performance. Figures are in millions of dollars.
"We are off to a great start in 2021 as the broad economic recovery drove strong year-over-year and sequential volume growth across the majority of our portfolio, leading to the highest quarterly sales total in more than 2-years," said Chemours President and CEO Mark Vergnano. "This outcome was achieved despite managing through supply chain challenges and operational headwinds, most notably from Winter Storm Uri. Looking ahead, our strong 1Q results and growing confidence in the outlook allows us to raise our 2021 full-year Adjusted EBITDA range by USD100 million with Free Cash Flow now expected to be greater than USD450 million."
First quarter 2021 Net Sales were USD1.4 billion, 10% higher than the prior-year quarter, which included a negative 1% portfolio impact from the exit of the aniline business. 11% volume growth was the primary driver of the better year-over-year sales performance with positive contributions from every segment, led by robust growth in Titanium Technologies and Advanced Performance Materials. The 7% sequential sales improvement was supported by a global macro recovery that drove sales higher in Titanium Technologies, Thermal & Specialized Solutions, Advanced Performance Materials, and Chemical Solutions after accounting for portfolio changes.
First quarter Net Income was USD96 million, resulting in EPS of USD0.57. Adjusted Net Income was USD120 million, resulting in Adjusted EPS of USD0.71, flat vs. the prior-year quarter. Adjusted EBITDA for the first quarter 2021 was USD268 million in comparison to USD257 million in the prior-year first quarter, a result of higher volume and favorable currency impact, partially offset by lower average pricing, under absorption of fixed costs stemming from Winter Storm Uri related plant shutdowns, and higher performance-related compensation. The cost impact of Winter Storm Uri, excluding the impact of lost sales, on Adjusted EBITDA is USD9 million, mostly in Thermal & Specialized Solutions. Free Cash Flow improved USD41 million vs. the prior-year quarter primarily driven by lower capital expenditures.
Chemours reported USD268m in adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) up from USD257m from Q1 2021. Winter storm Uri represented a USD9m hit in adjusted EBITDA, excluding its effect on sales. The costs from the storm were mostly in Chemours's Thermal & Specialized Solutions segment.
As per MRC, Chemours says it is looking to achieve a 60% absolute reduction of operations-related greenhouse gas emissions by 2030, and net zero greenhouse gas emissions by 2050. In addition to refrigerants, Chemours is a major producer of titanium dioxide, industrial fluoropolymer resins and derivatives and other chemical solutions.
As MRC informed before, in December 2019, Chemours announced plans to sell its methylamines and methylamides unit to Belle Chemical, an affiliate of Cornerstone Chemical. The sales price was not disclosed. Thus, Chemours had signed a letter of commitment with Belle Chemical Co. to sell Chemours' methylamines and methylamides business and production facilities at the Belle location. Earlier in 2019, Chemours announced it would stop making methylamines and methylamides at the plant. In 2020, it planned to start dismantling the methylamines operations. Once Belle takes possession of the plant, most of the employees at Belle and others assigned in supporting roles at other locations will become part of Belle, Chemours said. Cornerstone makes acrylonitrile (ACN) and melamine at Fortier, Louisiana.
ACN is a feedstock for the production of acrylonitrile-butadiene-styrene (ABS).
According to the ICIS-MRC Price Report, Plastik (Uzlovaya) increased the price of ABS for Russian converters for the second half of March. So, unpainted material is offered by the plant at a price of Rb282,000-290,000/tonne FCA Nodal, including VAT.
Chemours is a global leader in titanium technologies, fluoroproducts and chemical solutions, providing its customers in a wide range of industries with market-defining products, application expertise and chemistry-based innovations. Chemours ingredients are found in plastics and coatings, refrigeration and air conditioning, mining and oil refining operations and general industrial manufacturing. Chemours has approximately 9,000 employees across 37 manufacturing sites serving more than 5,000 customers in North America, Latin America, Asia-Pacific and Europe. Chemours is headquartered in Wilmington, Del.